Key Takeaways
- BP’s profit slumped in the second quarter, joining rivals in feeling the impact of lower oil and gas prices.
- Second quarter profits were down by more than half from 2022.
- Even with the drop in profit, BP raised its dividend and announced a new stock buyback.
BP (BP) is the latest to join the list of major energy companies that posted big profit declines because of falling oil and gas prices.
The British petroleum giant reported fiscal 2023 second quarter profit of $2.6 billion, a more than 69% drop from $8.5 billion a year ago.
BP indicated it had significantly lower oil and gas realizations, lower realized refining margins, significantly higher turnaround and maintenance activity, a weak oil trading result, and an exceptional gas marketing and trading result, although lower than in the first quarter.
CEO Bernard Looney said it was “another quarter of performing while transforming,” adding the company’s underlying performance was resilient with good cash delivery during “a period of significant turnaround activity and weaker margins in our refining business.”
Rivals Chevron (CVX), Exxon Mobil (XOM), and Shell (SHEL) also saw earnings shrink because of the decline in energy prices.
Despite the slide in profits, BP announced it was raising its dividend by 10% to $0.0727 per share, and would make another $1.5 billion in stock buybacks prior to the release of its third quarter financial results.
American Depositary Receipts (ADRs) of BP were down 1.5% in early trading on Tuesday but remained in positive territory for the year.